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Civil engineering project starts on the rise

New construction project starts fell 30% in April compared with a year ago but civil engineering project starts have picked up since the beginning of the year, according to the latest research by construction market intelligence firm Glenigan.

The Glenigan Index shows that the recent upturn in the value of underlying civil engineering project starts since the start of the year continued during April. A dip in transport project starts in April was offset by the continued strength of the energy sector and a rise in waste transfer projects, it said.

However, significant falls in project starts in the health, education and community and amenity sectors that provide no relief from private sector decline.

Last autumn’s Pre-Budget brought forward £3bn of capital investment from 2010 to 2011. But the declines in public sector starts highlight the slow progress by government departments in making use of the additional funding. This is reflected in a £700M capital under spend in the last financial year in the four key areas of health, education, transport and social housing.

While detailed planning approvals for public sector projects have been weak, Glenigan said a number of projects at the tender stage indicate a more positive second half of 2009.

However, it added that conditions in the housing sectors are grim, with the Residential Index during April at less than half the level of a year ago and the flow of new social housing schemes also significantly down on a year ago.

Overall, based on projects being tracked by Glenigan, it said it expected the Glenigan Index will be 18% down during the second quarter of 2009 on a year ago. While it predicted improvements in the index during the second half of the year, it said construction activity would be likely to remain subdued until 2011.

Readers' comments (1)

  • Melbourne Engineer

    That is definitely good news. Have to say, here in Florida my firm Alacri Inc. is seeing more buzz, more people looking at property, but not more business just yet.

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